Economic recommendations merit consideration

THE ISSUE

A bipartisan commission appointed by Governor Lingle has recommended measures to sustain the state's prosperity.

RECOMMENDATIONS by a task force created eight years ago by then-Gov. Ben Cayetano to bring the state out of the economic doldrums of the 1980s were soundly rejected by the Legislature. The more modest prescription by a commission created by Governor Lingle to sustain the state's current economic flourish is less controversial and deserves the Legislature's consideration.

Cayetano's Economic Revitalization Task Force of 1987 called for an increase in the general excise tax from 4 percent to 5.35 percent. Cayetano urged a more modest increase to 4.5 percent, but even that was rejected. This year's Legislature allowed a 4.5 percent hike, with county council permission, targeted at helping pay for a mass transit system for Oahu.

Lingle's bipartisan Economic Momentum Commission, comprised of 30 business, union and government officials and legislators, calls for a "moratorium" on the general excise tax for food and over-the-counter drugs as a way of returning to residents half of the state's estimated $632.6 million budget surplus for 2006-'07. A tax cut is obviously more popular than an increase.

The governor proposed in August that the standard income tax deductions be raised and tax credits be given to offset excise taxes and other expenditures by lower-income families. The commission asserts that its method "would have the added benefit of lowering the cost of living proportionately more for the lower income earners." That method is more likely to suit the Democratic Legislature.

Other suggestions by the Lingle commission are less drastic than the Cayetano task force's proposals and stand a better chance of acceptance. For example, while the task force proposed abolishing the state Land Use Commission, the Lingle panel proposes legislation "to clarify and upgrade the role of the LUC and to streamline the (development) process by eliminating costly overlapping responsibilities between the state and counties."

The Cayetano task force's recommendation that he be given the authority to appoint county school boards to replace the state Board of Education was given a speedy "F." Although Lingle has called for elected county school boards, her commission stays clear of the thorny issue. Instead, it calls for a series of initiatives within the parameters of the existing structure.

The Lingle panel's most innovative proposal is that the city and state engage in a public-private partnership in building 6,000 affordable owner-occupant houses on a 500-acre site at Kalaeloa, formerly Barbers Point Naval Air Station. Such a development, similar to the Hawaii Community Development Authority's Kakaako overhaul, would "include mix-use live/work/play design, a convenient connector to the planned mass transit system, and have ample green space."

The commission includes other suggestions for increased housing, along with recommendations in the areas of work training, tourism, agriculture, energy, health care, environmental protection and harbors. They merit public input and legislative consideration.